Despite declining volumes, checks remain an important part of the overall payments ecosystem. With current market conditions, combined with aging technology that drives up processing costs, determining a strategy that keeps costs down and efficiencies up is critical for survival. In fact, a Finextra survey published in July 2023 ranked reducing processing costs through payments modernization (79%) as a top priority.

Alogent has worked with financial institutions for over 25 years, improving their deposit environments, yet as solutions age, it’s important to assess existing infrastructures and determine points of vulnerabilities and potential savings. The following three areas for consideration can be applied at any institution as you look to improve your ROI and total cost of ownership and still address market needs:

1. Review your existing solutions. Analyze your overall spend and review your IT overhead, along with any manual processes required within your check processing workflows. Based on your findings, you may consider newer, more modern technology across one or all of your deposit channels, paying close attention to the overall architecture and tech stacks utilized. Simultaneously, consider the impact your platforms have on the user journey — both internally with employees and other account holder-facing factors. Is the user experience seamless? Can you start a transaction in one channel and complete it in another?

2. Consider the capability gaps in your current payments ecosystem, which often contribute to additional or unseen costs. Do any of the following negatively impact your bottom line today?

• Managing multiple vendors and multiple lines of business solutions: Maintaining multiple solutions across each deposit channel may require specialized teams and resources. In parallel, maintaining independent relationships with a number of solution providers can be time consuming and costly. By considering a platform and provider consolidation, institutions can save significant IT resources and gain faster access to business intelligence through streamlined workflows, consistent business rules and centralized databases — not to mention deploying new features, updates and products more quickly. Consistency is truly the name of the game.
• Batch processing and exchanging files between systems: On the surface, batch processing seems ideal; however, batches are typically processed for the Fed later in the day, and if an error is found, it delays the processing of all transactions. In addition, deposit visibility is lost throughout the day, which may result in duplicate transactions being submitted across different channels because of delayed posting. More modern platforms today allow for item or transaction-centric processes with real-time image and data validation, eliminating the need for batches, file exchanges between systems and enabling real-time posting.
• Growing fraud attacks and exposure: Check fraud is still a major threat and is becoming more difficult and expensive to resolve. Modern deposit platforms can help mitigate check fraud risks by improving a financial institution’s ability to monitor and validate deposits and by enabling a customized account holder scoring model that leverages an individual’s financial story, such as deposit and spending habits. Risk can be identified quicker, and users benefit from a more streamlined user journey across deposit channels.
• Lack of scalability and flexibility: Aging deposit solutions can be limited in their integration abilities and go-to-market models, hindering the ability to add new features or new servers and workstations as check volumes fluctuate. API-driven, cloud-native platforms are designed to scale up or down as needed and connect to third-party solutions with ease, giving financial institutions a more flexible environment to address internal goals and market needs.
• Delays and service impacts when testing or performing maintenance: It’s not uncommon with existing solutions to take your entire platform offline to test or perform maintenance. Not only does this impact resources and costs, but account holders lose access to needed services during such times. Newer platforms leverage more modern architectures like dockers and containers, allowing teams to focus their efforts in isolation — meaning testing, updating and rolling out of new features can be completed without having to take your entire application offline.

3. Consider the investment in “real-time.” Real-time capabilities, real-time access to data and real-time risk analysis. Beyond the cost savings and technical advancements of modern image acquisition and processing platforms, the efficiencies gained will benefit both your institution and your account holders. Those platforms that leverage a centralized database across all deposit channels enable fast access to business-critical information customizable by role — identifying trends, needs and gaps on an enterprise level easier and quicker. Simultaneously, account holders benefit on the front end with a consistent UX across deposit channels and a decreased risk of fraud given greater access to information.

Reduce Costs and Keep up with Market Needs with Unify

Cloud-native and with a thin client architecture, Unify is the only solution of its kind on the market. Built with flexible, scalable and OS-agnostic architecture, Unify addresses full- and self-service deposit channels with the same platform and single API to go-to-market your way — across your institution or by deposit solutions: in-branch with teller capture, remotely through mobile or kiosks like ATM/ITM; through commercial channels; and more. Blurring the lines between Day 1 and Day 2 processing for financial institutions, Unify is proven to deliver tangible cost savings and a reduction of IT overhead.